Professionalization of Public Procurement Jorge
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Professionalization of Public Procurement Jorge Claro President CEO INPRI INGP XII Annual Conference Montego Bay - November, 2016 Contents of the presentation Why professionalize procurement? What is INPRI? INPRI Jamaica The Training and
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01
Professionalization of Public Procurement Jorge Claro
President & CEO
INPRI
INGP XII Annual Conference
Montego Bay - November, 2016<br>
President & CEO
INPRI
INGP XII Annual Conference
Montego Bay - November, 2016<br>
02
Contents of the presentation Why professionalize procurement?
What is INPRI?
INPRI Jamaica
The Training and certification programme
Results of the programme
Congratulations to Jamaica 2<br>
What is INPRI?
INPRI Jamaica
The Training and certification programme
Results of the programme
Congratulations to Jamaica 2<br>
03
Why professionalize procurement? Most important roles of a government include the control and management of public resources
Public Sector Procurement (PSP) and the integrity of financial management systems fundamentally impact upon the level of trust that citizens have in the government 3<br>
Public Sector Procurement (PSP) and the integrity of financial management systems fundamentally impact upon the level of trust that citizens have in the government 3<br>
04
Why professionalize procurement? Modern governments are well aware that these core public finance activities combine to determine
The ability to attract and retain foreign investment
The cost of borrowing
competitiveness 4<br>
The ability to attract and retain foreign investment
The cost of borrowing
competitiveness 4<br>
05
Why professionalize procurement? Governments have recognized and acted on the criticality of:
transparent legal frameworks for PSP
professionally staffed institutional frameworks with clearly defined roles and responsibilities
strong accountability frameworks that are enforced in practice 5<br>
transparent legal frameworks for PSP
professionally staffed institutional frameworks with clearly defined roles and responsibilities
strong accountability frameworks that are enforced in practice 5<br>
06
Why professionalize procurement? PSP policies and strategies that:
support national growth and development agendas, and
are grounded in the fundamental principles of efficiency, effectiveness, economy, competition, fair treatment and transparency, and
the implementation and effective operation of independent monitoring and oversight of governmental actions in the PSP framework 6<br>
support national growth and development agendas, and
are grounded in the fundamental principles of efficiency, effectiveness, economy, competition, fair treatment and transparency, and
the implementation and effective operation of independent monitoring and oversight of governmental actions in the PSP framework 6<br>
07
Why professionalize procurement? The foregoing is well understood and widely accepted best practice in PSP
It is important to recognize that PSP policy making and activities do not occur in a vacuum
Many regional challenges in PSP come about as result of smaller size, lower levels of development and unique vulnerabilities 7<br>
It is important to recognize that PSP policy making and activities do not occur in a vacuum
Many regional challenges in PSP come about as result of smaller size, lower levels of development and unique vulnerabilities 7<br>
08
Why professionalize procurement? Development assistance agencies tend to group countries into regions
While we understand the rationale, perhaps this is not the best way to deal with particular country-specific issues, particularly in PSP
A perfect example is the LAC region. While many member countries share similar characteristics, economic and otherwise, they are very diverse States 8<br>
While we understand the rationale, perhaps this is not the best way to deal with particular country-specific issues, particularly in PSP
A perfect example is the LAC region. While many member countries share similar characteristics, economic and otherwise, they are very diverse States 8<br>
09
Why professionalize procurement? Typical differences include mainly:
commodity exporters e.g., Guyana and Trinidad and Tobago
agriculture based e.g., Belize
service based, e.g., The Bahamas
financial and tourism services
While others are well on the way to knowledge-based transformations – like Chile 9<br>
commodity exporters e.g., Guyana and Trinidad and Tobago
agriculture based e.g., Belize
service based, e.g., The Bahamas
financial and tourism services
While others are well on the way to knowledge-based transformations – like Chile 9<br>
10
Why professionalize procurement? These countries all face similar challenges although in varying degrees such as:
internal and external debt burdens
low growth
limited elasticity to cushion and recover from internal and external shocks
vulnerability to natural events
Earthquakes
Hurricanes 10<br>
internal and external debt burdens
low growth
limited elasticity to cushion and recover from internal and external shocks
vulnerability to natural events
Earthquakes
Hurricanes 10<br>
11
Why professionalize procurement? Further, these States are highly open to international trade in an environment where comparatively small size constraints, particularly in the Caribbean, effectively preclude realization of benefits from economies of scale, leading to high levels of international trade imbalances 11<br>
12
Why professionalize procurement? In addition to the foregoing, the 2008/09 global financial crisis had a severe impact in LAC
While some countries are slowly recovering, others still face significant uphill battles arising from decreased levels of tourism, remittances, and exports, thus further deteriorating already weak financial positions and increasing already high debt burdens 12<br>
While some countries are slowly recovering, others still face significant uphill battles arising from decreased levels of tourism, remittances, and exports, thus further deteriorating already weak financial positions and increasing already high debt burdens 12<br>
13
Why professionalize procurement? Many of these States while still struggling to recover from the effects of this crisis, are facing new ones including “brain drain”
And the loss of skilled workers contributes to low levels of business competitiveness with negative impact on the quality and quantity of investment that countries are able to attract 13<br>
And the loss of skilled workers contributes to low levels of business competitiveness with negative impact on the quality and quantity of investment that countries are able to attract 13<br>
14
Why professionalize procurement? In addition, there are many other challenges that developing countries in the LAC region must grapple with including:
crime and violence
gender imbalances in economic opportunities
poverty
climate change
demographic issues 14<br>
crime and violence
gender imbalances in economic opportunities
poverty
climate change
demographic issues 14<br>
15
Why professionalize procurement? A further and new threat for many of the LAC countries is what we can call “FEXIT”
FEXIT = The move by banks in developed countries to dissolve relationships with LAC financial institutions as part of efforts to reduce corruption, money laundering and other fiscal malpractices 15<br>
FEXIT = The move by banks in developed countries to dissolve relationships with LAC financial institutions as part of efforts to reduce corruption, money laundering and other fiscal malpractices 15<br>
16
Why professionalize procurement? FEXIT is severely constraining the free flow of funds across borders, negatively impacting trade and commerce, tourism and remittances, upon which LAC economies depend 16<br>
17
Relevance to the professionalization of procurement? Why am I touching on these subjects and what has this to do with the subject at hand, that is the need to professionalize PSP? 17<br>
18
Why professionalize procurement? Because it is no difficult to correlate the impact of the issues mentioned on an activity like PSP if the perception is that:
There is opacity in the PSP market
Legal frameworks are obsolete and the rule of law does not apply
Accountability is lacking, and most importantly
There is lack of a professionally trained and certified procurement cadre 18<br>
There is opacity in the PSP market
Legal frameworks are obsolete and the rule of law does not apply
Accountability is lacking, and most importantly
There is lack of a professionally trained and certified procurement cadre 18<br>
19
Why professionalize procurement? If foreign suppliers are unable to participate in a stable market and have assurances that the rule of law applies and that they will be able to remit profits, their participation in PSP opportunities will significantly decrease
Less competition, less aggressive bidding equals less likelihood of obtaining innovative BVFM solutions to the procurement needs 19<br>
Less competition, less aggressive bidding equals less likelihood of obtaining innovative BVFM solutions to the procurement needs 19<br>
20
Why professionalize procurement? Taken together, these challenges bring pressure to bear on governments to modernize their PSP systems, including finding an optimal balance of the several objectives that can be progressed through procurement policy and practice, such as the traditional procurement VFM and related objectives 20<br>
21
Why professionalize procurement? Important to recognize that the benefits of a sound PSP system that incorporates social, environmental and developmental goals transcend the immediate confines of PSP, extending to attracting Foreign Direct Investment (FDI), product diversification, support for promising nascent industries, socio-economic balance, and other welfare gains 21<br>
22
Why professionalize procurement? Also important to remember that sound PSP policies and good practices, by themselves, cannot adequately resolve all of the issues mentioned
But it remains an extremely powerful and rewarding driver for national growth and development and, by extension, regional growth and development 22<br>
But it remains an extremely powerful and rewarding driver for national growth and development and, by extension, regional growth and development 22<br>
23
Why professionalize procurement? One of the most important determinants in ensuring that the PSP system can optimally address these challenges is ensuring the existence of a trained professional cadre
Modernizing legislative, institutional, technological and normative frameworks are necessary but insufficient conditions for ensuring success 23<br>
Modernizing legislative, institutional, technological and normative frameworks are necessary but insufficient conditions for ensuring success 23<br>
24
Why professionalize procurement? Essential to invest in human capital in order to build professionalism in the procurement cadre, with a common set of ethical and professional standards and a sound grasp, not only of the of best practices, but also of their application in varying circumstances 24<br>
25
Why professionalize procurement? As more countries adopt a decentralized approach to procurement, the need for adequately trained procurement professionals with a wide-ranging set of skills has become more urgent 25<br>
26
Why professionalize procurement? In addition, procurement officials today in many cases perform the functions of contract managers, requiring specialized competence in PSP and also in project management, change, risk
In addition, increasingly, these officials must be able to handle Public-Private Partnerships (PPPs) in the provision of goods and services to citizens 26<br>
In addition, increasingly, these officials must be able to handle Public-Private Partnerships (PPPs) in the provision of goods and services to citizens 26<br>
27
What is INPRI? Considering the demands mentioned and the pressing, urgent need to professionalize procurement, the International Procurement Institute (INPRI) was established in 2007 in Washington D.C., USA, as a Centre of Excellence in Public Procurement
This was followed by the establishment of INPRI subsidiaries is Santiago, Chile and Kingston, Jamaica 27<br>
This was followed by the establishment of INPRI subsidiaries is Santiago, Chile and Kingston, Jamaica 27<br>
28
What is INPRI? INPRI is a niche institute in that it focuses only on PSP in order to improve the levels of procurement performance through the application of internationally recognized procurement best practices 28<br>
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INPRI’s mission INPRI’s mission is to promote excellence in PSP by providing specialized training and internationally recognized accredited certification, advice and support to a wide-range of stakeholders including governments, international organizations, private sector companies and civil society 29<br>
30
INPRI’s mission In fulfilling its mission, INPRI:
Conducts research and assists in the development of procurement and e-procurement systems in the context of reform of the state efforts
Provides assistance to International Organizations in their review of project-specific procurement, as well as in the assessment of the procurement capacity of public and private entities 30<br>
Conducts research and assists in the development of procurement and e-procurement systems in the context of reform of the state efforts
Provides assistance to International Organizations in their review of project-specific procurement, as well as in the assessment of the procurement capacity of public and private entities 30<br>
31
INPRI’s mission Provides advisory services to government modernization programs
Develops and delivers training programs and courses designed to meet the needs of the several PSP stakeholders, including
procurement practitioners
Policymakers
Regulators
Suppliers, and
civil society 31<br>
Develops and delivers training programs and courses designed to meet the needs of the several PSP stakeholders, including
procurement practitioners
Policymakers
Regulators
Suppliers, and
civil society 31<br>
32
INPRI’s mission Collaborates with national anti-corruption efforts by:
conducting training on ethical practices in procurement
assisting Civil Society Organizations in procurement monitoring, and
drafting documents, presentations and opinion articles on the subject 32<br>
conducting training on ethical practices in procurement
assisting Civil Society Organizations in procurement monitoring, and
drafting documents, presentations and opinion articles on the subject 32<br>
33
INPRI’s mission Delivers a wide range of individual courses on topical procurement issues including:
Procurement policy and practices as a development driver
Public-Private Partnerships
Contract Administration
The International Trade Dimension of PSP 33<br>
Procurement policy and practices as a development driver
Public-Private Partnerships
Contract Administration
The International Trade Dimension of PSP 33<br>
34
INPRI Jamaica INPRI Jamaica was established in order to better serve the needs of the region
For example, INPRI Jamaica has signed an MOU with the Government of Jamaica (GOJ) to train the country’s PSP officials 34<br>
For example, INPRI Jamaica has signed an MOU with the Government of Jamaica (GOJ) to train the country’s PSP officials 34<br>
35
Training and certification programme This is done through INPRI Jamaica’s acclaimed flagship programme, the Public Procurement Certification Series (PPCS), which is accredited by the University Council of Jamaica (UCJ) 35<br>
36
Training and certification programme The PPCS is an intensive, comprehensive series of courses on international best practices in PSP, addressing fundamental elements through 4 courses:
Level 1. Essential elements of PSP
Level 2. Intermediate PSP
Level 3. Advanced PSP
Level 4. PSP Performance and Compliance Audit and Investigation 36<br>
Level 1. Essential elements of PSP
Level 2. Intermediate PSP
Level 3. Advanced PSP
Level 4. PSP Performance and Compliance Audit and Investigation 36<br>
37
Response to the programme The response to it has been excellent and to date, INPRI Jamaica has trained and certified almost 500 PSP professionals in Jamaica, positioning the country well on the path to having a fully competent and internationally certified cadre of public procurement professionals 37<br>
38
Congratulations to Jamaica GOJ in general and particularly the Procurement and Asset Policy Unit (PAPU) of the Ministry of Finance, in charge of the programme - and our host - should be congratulated on this unprecedented initiative to train ALL PSP officials in the country, an important component of Jamaica’s PSP reform and modernization efforts 38<br>
39
PPCS series This initiative is already being felt as the country modernizes and streamlines its processes and am sure its impact will be felt for years to come
Needless to say, INPRI Jamaica is very proud of its association with GOJ in this ambitious programme and looks forward to continuing collaborating with GOJ 39<br>
Needless to say, INPRI Jamaica is very proud of its association with GOJ in this ambitious programme and looks forward to continuing collaborating with GOJ 39<br>
40
Many thanks for your kind attention Jorge Claro
President & CEO
INPRI
jclaro@inpri.org
www.inpri.org<br>
President & CEO
INPRI
jclaro@inpri.org
www.inpri.org<br>